Public Service Law: Privatization's Unexpected Offspring

Public Service Law: Privatization's Unexpected Offspring

Article excerpt

TONY PROSSER [*]

I

INTRODUCTION

The United Kingdom was the pioneer, if not of privatization, of a large scale privatization program extending to the public utilities: And it remains in the forefront of attempts to introduce forms of the new public management using private sector techniques in public administration. [1] One might think that this means that the role of public law, and of distinctive notions of public service embodied in law, have disappeared in those areas where privatization has taken place. Indeed, this perceived decline in public service law is the characteristic criticism of the British experience by commentators in Continental Europe. The Conservative governments of the United Kingdom certainly intended to replace hierarchical administrative controls with a marketplace in which resort to the courts on public law matters would be unnecessary. [2]

In this article, however, I hope to suggest a paradox. The United Kingdom has experienced a new growth of public service law in relation to the privatized utilities. This has resulted in a convergence of the tradition of the United Kingdom and that of nations such as France and Italy, where public service has played a central role in public law, due in part to a unique rhetoric of public service in the Continental tradition. Indeed, it could be argued that the regulatory reform that accompanied privatization has made possible the development of a distinct discipline of public service law in the United Kingdom. [3] In this article, I define public service law as law designed to make basic public services available to all citizens without discrimination. This may require modification of the operation of markets and recognition of the need to compensate for substantive inequalities by providing services to the disadvantaged. Thus, public service law has both a descriptive and a normative dimension. It is descri ptive in that it is concerned with goods and services provided by institutions between the market and the state, which may include public enterprises at arm's length from government. It is normative in the sense that it is based on egalitarian rights derived from citizenship rather than an ability to bid in the marketplace. [4] My discussion of the development of a discipline of public service law in the United Kingdom will be limited to the privatization of public utilities.

II

THE ABSENCE OF A TRADITION OF PUBLIC SERVICE IN THE UNITED KINGDOM

In marked contrast with their Continental neighbors, the British have traditionally been reluctant to enshrine requirements of public service in their system of law. During the nineteenth century, however, a relatively little-known body of common law developed to ensure access to monopoly services and to avoid discrimination in the way in which such access was provided. [5] The best-known of these cases concerned access to a dock monopoly, [6] but other examples included rights of access to ferries, bridges, and other early public utilities. [7] These cases may represent an early attempt to develop competition law in the interest of economic efficiency by minimizing market distortions created by monopoly power. Implications of this trend in the case law reached beyond competition law, however. And as Paul Craig has documented, the cases suggest the recognition of some form of public property rights triggered by the possibility of restrictions on public access to essential, but privately owned, services. [8]

These cases could have supported the establishment of principles concerned with rights of equal access to public services, like those that developed in France that are described below. Indeed, in the United States, cases such as Allnutt v. Inglis were influential in forming a basis for the constitutional acceptance of utility regulation. [9] In the United Kingdom, however, they were largely forgotten, especially after the nationalization of the public utilities, culminating in the statutes of the Labour Government in the late 1940s. …